It has happened. ANZ is matching Westpac's carded 2.29% one year fixed rate 'special'.
While it is not really a surprise, the nine day head start Westpac has had is.
ANZ isn't changing any other rates however (and Westpac didn't either).
Readers should expect most other banks to either cut their carded offers to a similar level, or offer lower rates for other terms, or match these lower offers informally, deal-by-deal.
Probably, most will do all three.
ANZ's special interest rates require a minimum 20% equity and an ANZ transaction account with salary direct credited, otherwise their standard rate applies. Specials are not available with their package discount offers.
ANZ is also cutting -5 bps from its term deposit offers for terms six months to two years.
Remember, the RBNZ's Funding for Lending program is in place, allowing banks to access money at the OCR's 0.25%.
If banks use that funding line, they can still keep their margins intact with rates down to about 2%.
Only one bank has drawn $1 bln in the FLP line late so far, doing so late last year. $1 bln is enough to fund about 2000 home loans.
Despite these big-bank cuts, they are not the lowest one year fixed rate available. HSBC offers the same term at 2.25%, and Heartland Bank still has a 1.99% fixed offer for one year.
One useful way to make sense of these new lower home loan rates is to use our full-function mortgage calculators.
And if you already have a fixed term mortgage that is not up for renewal at this time, our break fee calculator may help you assess your options.
Here is the updated snapshot of the lowest advertised fixed-term mortgage rates on offer from the key retail banks at this time.
|Fixed, below 80% LVR||6 mths||1 yr||18 mth||2 yrs||3 yrs||4 yrs||5 yrs|
|as at January 20, 2021||%||%||%||%||%||%||%|
|Bank of China||3.45||2.55||2.65||2.65||2.75||2.85||2.95|
|China Construction Bank||4.70||2.65||2.65||2.65||2.80||2.89||2.99|
|[incl Price Match Promise]||2.89||2.29||2.49||2.49||2.65||2.99||2.99|
In addition to the above table, BNZ has a unique fixed seven year rate of 5.20%.